Shri Jay Kumar Sood, Shimla V. DCIT, Chandigarh

ITA 316/CHANDI/2014

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8355 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 09-02-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 28-03-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Unexplained investment; Sale consideration of property below Jantri Value
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO.316 /CHD/2014 (ASSESSMENT YEAR : 2009-10) SHRI JAY KUMAR SOOD, VS. THE D.C.I.T., S/O SH.MAST RAM SOOD, CENTRAL CIRCLE II, SANJAY SADAN, CHOTTA SHIMLA, CHANDIGARH. SHIMLA. PAN: ANZPS8958B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUDHIR SEHGAL RESPONDENT BY : SHRI SUSHIL KUMAR, DR DATE OF HEARING : 13.02.2017 DATE OF PRONOUNCEMENT : 13.02.2017 O R D E R PER ANNAPURNA GUPTA, A.M . : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)(CENTRAL), GURGAON DATED 7.2.2014 RELATING TO ASSESSMENT YEAR 2009-10. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS O F APPEAL : 1. THE LD. CIT(A) HAS ERRED BY UPHOLDING THE ORDER OF THE LD. DCIT WHICH IS CONTRARY TO LAW AND THE FACTS OF THE CASE. 2 2. THE LD. CIT(A) HAS ERRED BY UPHOLDING THE LD. DCITS ORDER WHEREIN HE ADDED RS.15,88,500/- AS UNEXPLAINED INVESTMENT. 3. THE LD. DCIT ERRED BY ADDING RS,.24,614/- AS UNEXPLAINED CASH CREDIT. 3. AT THE OUTSET IT MAY BE STATED THAT GROUND NOS. 1 AND 3 RAISED BY THE ASSESSEE WERE NOT PRESSED BY TH E ASSESSEE AND THE SAME, THEREFORE, ARE TREATED AS DISMISSED. 4. THE ONLY GROUND WHICH REMAINS TO BE ADJUDICATED IS GROUND NO.2 WHICH IS AGAINST THE ADD ITION OF RS.15,58,500/- MADE U/S 69 OF THE INCOME TAX ACT , 1961 ( IN SHORT THE ACT) AS UNEXPLAINED INVESTMENT . 5. BRIEF FACTS RELATING TO THE ISSUE ARE THAT DURI NG ASSESSMENT PROCEEDINGS, IT WAS REVEALED THAT THE AS SESSEE HAD PURCHASED A LAND FOR RS.2,88,500/- AT REHAI. O N PERUSAL OF THE CONVEYANCE DEED, THE ASSESSING OFFIC ER OBSERVED THAT THE MARKET VALUE OF THE LAND HAS BEEN TAKEN AT RS.14,70,000/- FOR THE PURPOSE OF STAMP DUTY, WH EREAS THE ASSESSEE HAD PAID CONSIDERATION MONEY OF RS.2 L ACS ONLY AND INCURRED EXPENSES OF RS.88,500/- TOWARDS REGISTRATION CHARGES AND STAMP DUTY. ON BEING CONF RONTED WITH THE SAME, THE ASSESSEE EXPLAINED THAT THE LAND WAS LAND-LOCKED AND HENCE NOT APPROACHABLE BY ROADS AN D ALSO THE VALUE OF LAND HAD BEEN TAKEN BY THE STAMP AUTHORITY ON THE BASIS OF RECENT REGISTRATIONS IN T HE AREA FOR PRIME LAND. THE ASSESSEE STATED THAT FOR THE 3 AFORESTATED REASONS THERE WAS A HUGE DIFFERENCE IN THE STAMP DUTY VALUE OF THE LAND AND THAT ACTUALLY PAID BY THE ASSESSEE. THE ASSESSING OFFICER REJECTED THE ASSES SEES CONTENTION AND FURTHER SINCE EVEN THE SOURCE OF INVESTMENT OF RS.2,88,500/- WAS NOT EXPLAINED BY TH E ASSESSEE, HE TREATED THE MARKET VALUE OF THE LAND O F RS.14,70,000/- AND THE EXPENDITURE OF RS.88,500/- INCURRED BY THE ASSESSEE TOWARDS STAMP DUTY AND REGISTRATION CHARGES, AS UNEXPLAINED INVESTMENT U/S 69 OF THE ACT AND MADE ADDITION OF THE SAME TO THE INCOME OF THE ASSESSEE. 6. THE MATTER WAS CARRIED IN APPEAL BEFORE THE LD. CIT (APPEALS) WHERE THE ASSESSEE CONTENDED THAT THE ADD ITION MADE WAS UNWARRANTED SINCE THE LAND WAS NOT PURCHA SED IN THE IMPUGNED YEAR AT ALL AND MOREOVER SINCE NO INCRIMINATING MATERIAL PERTAINING TO THE SAME WAS F OUND DURING THE COURSE OF SEARCH. THE LD. CIT (APPEALS) REJECTED THE ASSESSEES CONTENTION AND UPHELD THE A DDITION MADE. 7. DURING THE COURSE OF HEARING BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE CONTENTION MADE BEFORE THE LD. CIT (APPEALS) AND STATED THAT THE SA ID INVESTMENT IN LAND DID NOT TAKE PLACE IN THE IMPUGN ED YEAR AT ALL BUT IN FACT IN THE SUCCEEDING YEAR. TH E LD. COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO THE SALE AGREEMENT RELATING TO THE SAID PURCHASE OF LAND AND SPECIFICALLY POINTED OUT THE DATE OF EXECUTION OF T HE SALE 4 DEED MENTIONED THEREIN AS 2 ND APRIL, 2009 PERTAINING TO FINANCIAL YEAR 2009-10 RELEVANT TO ASSESSMENT YEAR 2010- 11. THE LD. COUNSEL FOR THE ASSESSEE STATED THAT S INCE THE IMPUGNED PURCHASE RELATED TO ASSESSMENT YEAR 2010-1 1 AND NOT ASSESSMENT YEAR 2009-10, WHICH IS THE YEAR UNDER APPEAL IN THE PRESENT CASE, THE ADDITION COULD NOT HAVE BEEN MADE IN THE IMPUGNED YEAR AT ALL. 8. THE LD. DR, ON THE OTHER HAND, RELIED UPON THE ORDER OF THE LD. CIT (APPEALS). 9. WE HAVE HEARD THE CONTENTIONS OF BOTH THE PARTIES AND HAVING PERUSED THE DOCUMENTS REFERRED T O BEFORE US, WE FIND MERIT IN THE CONTENTION OF THE L D. COUNSEL FOR THE ASSESSEE THAT THE IMPUGNED TRANSAC TION OF PURCHASE OF LAND DID NOT PERTAIN TO THE YEAR UNDER CONSIDERATION IN THE PRESENT CASE. THE SALE DEED VI DE WHICH THE IMPUGNED PURCHASE OF LAND WAS MADE AND WH ICH IS PLACED AT PAPER BOOK PAGE NO.5, MENTIONS THE DAT E OF EXECUTION OF THE SALE DEED AS 2 ND APRIL, 2009. THE FACT THAT THE SAID SALE DEED PERTAINS TO THE INVESTMENT IN QUESTION BEFORE US HAS NOT BEEN CONTROVERTED BY THE LD. DR, NOR WAS ANY CONTENTION MADE BY THE LD. DR DISPL ACING THE DATE OF EXECUTION OF SALE DEED MENTIONED THEREI N. IN VIEW OF THE SAME, ADMITTEDLY, THE SAID TRANSACTION OF INVESTMENT IN LAND TOOK PLACE IN THE FINANCIAL YEAR 2009- 10 RELATING TO ASSESSMENT YEAR 2010-11. THEREFORE, THE SAID ADDITION PERTAINS TO ASSESSMENT YEAR 2010-11 A ND, THEREFORE, COULD NOT HAVE BEEN MADE IN THE YEAR UND ER 5 APPEAL BEFORE US I.E. ASSESSMENT YEAR 2009-10. FOR THIS REASON ALONE, WE HOLD THAT THE SAID ADDITION COULD NOT HAVE BEEN MADE IN THE PRESENT CASE. THE ORDER OF T HE LD. CIT (APPEALS) PERTAINING TO THIS GROUND IS, THEREFO RE SET ASIDE. THE GROUND OF APPEAL RAISED BY THE ASSESSEE IS, THEREFORE, ALLOWED. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (BHAVNESH SAINI) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 13 TH FEBRUARY, 2017 *RATI* COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT 5. THE DR ASSISTANT REGISTRAR, ITAT, CHANDIGARH